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2012年2月25日星期六

The burden of student debt

At the height of the Occupy protests last fall, young people held signs announcing how much they owed in student loans. While the pundits were asking each other what, exactly, the protesters wanted, a big part of the answer was on those signs: Students are leaving colleges and universities with a staggering financial burden and bleak job prospects.
“When you get out of college at 21 with a 30-year loan, it’s soul crushing,” says Scot Ross, executive director of One Wisconsin Now, a progressive organization that is launching an advocacy campaign on the issue. Ross is on leave to serve as communications director for gubernatorial candidate Kathleen Falk.
The student loan landscape has shifted dramatically since the parents of current students and recent graduates left college. In 2006, the U.S. Education Department’s National Center for Education Statistics reported that most borrowers who finished college in the early 1990s were able to manage their student loan burden. Most paid the loans back in 10 years. Today, many students face 20 to 25 years of making payments. In the early ’90s, about half of students borrowed; in 2006, two-thirds had to borrow. And their loans are much bigger.
Federal and state policy and budgetary decisions in recent years have contributed to the student debt burden. Public funding for public universities has fallen steeply at the same time that tuition has skyrocketed. Congress slashed funding for Pell Grants that helped the most needy students and put provisions in place to protect private lenders.
Federally funded student loans are no longer available from Sallie Mae, and its private loans have much higher interest rates than do home or car loans.
Last year, students borrowed more than $100 billion dollars — a new record. The College Board, an advocacy group that works to ensure that every student has the opportunity to prepare for, enroll in and graduate from college, reports that students are borrowing twice as much as in 2001. The total amount owed on all outstanding student loans is expected to reach $1 trillion next year. A full-time undergraduate student borrowed an average of almost $5,000 in 2010, 63% more than a decade earlier after adjusting for inflation, according to the College Board.
These young debtors are not just those who opted to attend prestigious private universities. Tuition at public universities has soared as those institutions struggle to offset cuts in public funding. University of Wisconsin-Madison’s in-state tuition jumped from $5,866 in 2005 to $9,672 in 2011. The estimated total cost for a year at UW-Madison was $15,256 in 2005. Now it’s $25,421.
About half of 2010-2011 bachelor’s degree recipients at UW-Madison will have borrowed an average total of $24,493, says Susan Fischer, director of the office of Student Financial Aid. For those who go on to graduate school, the debts increase sharply. About three-quarters of law school graduates will have loans and owe an average $99,723. Almost 90% of medical school graduates will have borrowed, and their average debt will be $151,383.
To make matters worse, student loans differ from all other kinds of debt in two significant ways. They are excluded from bankruptcy protection, and it is not possible to refinance or restructure loans to take advantage of falling interest rates.
“It is easier to be a deadbeat dad than it is to lose your student loan debt,” Ross says of the lack of bankruptcy protection. “What does that say about us as a nation?”
People on disability who can’t afford to pay their student loans can even have their payments garnisheed, Ross notes. The only recourse, he adds, is “loan rehabilitation, which means you have to agree to make extended payments and take a new loan, with added fees. You end up with even more debt.”
Ross admits he has a dog in this fight. He borrowed about $30,000 in 11 different loans to pay for his bachelor’s and master’s degrees. He laughs, a little ruefully, when he admits that, at 42, he is in “year 12 of a 30-year student debt,” and says he’s fortunate to have a job and be able to keep up with the payments.
Ben Manski, founder of the Liberty Tree Foundation, is another advocate for reforms to the student loan system. He contends that the huge increases in student debt are the inevitable result of cuts to higher education in state budgets.
“Generation X was the first generation to experience the impact of debt and a restructured job market,” says Manski, 37, who was recently appointed campaign director for Green Party presidential candidate Jill Stein. “We are overemployed and overworked. We do not have job security. Retirement is not even a consideration. The Millennials have it even worse, because of high unemployment. When you have this kind of debt, you lose freedoms — the freedom to engage in public service, for example, or pursue the career you are most fitted for as opposed to one that will make ends meet.”
Despite the heart-stopping debt statistics, the UW’s Fisher thinks it’s still possible to get at least an undergraduate degree without going very deeply into debt.
“Sometimes, students accrue big debt because they change majors and take longer to graduate. Or they choose a private or out-of-state public school that the family really cannot afford. My advice to incoming students is to work while they are in school and live frugally. And get in and get out. If they do that, I think they can finish with a minimal amount of debt.”
But starting working life owing tens of thousands of dollars during a period of high unemployment has many students wondering how they will be able to afford to marry, have children or buy a house. Paying off even a relatively small loan in a sagging economy is proving very difficult for many people. Here are some of their stories.
‘You can’t live your life without worrying’
Christina Spector left UW-Madison with an undergraduate degree in elementary education and psychology (2002), a graduate degree in educational leadership and policy analysis (2008) and a law degree (also 2008).
“It was a conscious decision to go to UW-Madison for the in-state tuition. I had scholarships, a little help from my parents, and I always had jobs while I was in school,” she says. But it wasn’t enough.
“The first time I signed a promissory note, I had such a hard time of it. I cried for two days about entering that system, but I had no other choice.”
A school administration consultant for the State Department of Instruction, Spector will pay $550 a month for a total of 25 years before her loans are paid off. Her husband, who has a master’s degree and is employed by the American Federation of Teachers, makes student loan payments of $200 a month.
That $750 monthly expense means they must live very frugally.
“We are on a really strict budget,” she says. “We don’t make large purchases unless we absolutely have to. We bought much less house than we qualified for, and we drive an inexpensive car. We are thoughtful about little things like buying coffee. We take our lunch to work. We can’t travel, so we use our vacations to visit family.”
One place where the family does not cut corners is on daycare for their 2-year-old child.
“Daycare costs more than our mortgage, but that’s one thing you’re not going to scrimp on.”
The debt drives all the family’s decisions — having another child, making a career change, moving.
“It’s difficult sometimes, because you can’t live your life without worrying about it,” she says. “I am much less inclined to take any kind of risk because of it.”
Spector knows she could ease the financial burden by abandoning a job she loves in the public sector and joining a private law firm.
“I never went to law school wanting that. I always wanted to work in the public sector. I have friends from law school who have made that decision so they could pay off their loans. To me, it seems like selling your soul. I just couldn’t do it. That would be a true prison on top of the bondage of the loans.”
‘We have given up many things’
A Madison West high school graduate, Ben Manski has an undergraduate degree in sociology and a law degree from UW-Madison. His higher education left him with $70,000 in student loan debt. His wife, Sarah, also has debt for her student loans.
“I am paying about $500 a month. For both my wife and me, it’s about $800 a month. It’s a major part of our budget, almost as much as we pay for housing,” he says.
Although Manski could be earning big bucks in a private law firm, he has stayed true to his commitment to use his education to work for social change. Founder of the Liberty Tree Foundation, he ran for the state Legislature as a Green Party candidate in 2010. He also practices a little law and teaches sociology at Madison College.
“I had other choices I could have made,” Manski says. “I was offered a lobbying job for an insurance company when I was 22 years old that would have paid $80,000 a year. I turned it down.”
Manski and his wife have had to make difficult choices because of their student loans.
“It is very difficult to save, and we have given up many things. We are not in a position where we can help others financially. And, certainly, we are not having a family until we have the ability to afford kids,” he says. He and his wife recently started a new website, posipair.com, designed to put environmentally responsible businesses in touch with each other and with customers, in an effort to generate some independent income.
Manski, who comes from a family of teachers, has a passion for education and would like to teach full time.
“I think there’s no higher calling than teaching and no more important institution than education,” he says.
Sometimes, he says, his students ask him if their schooling is worth the money and if they will be able to get jobs when they finish. “I used to be able to say it is definitely worth it,” he says. “But now that question is more difficult to answer.”
‘We can’t take vacations’
When Kathy Wallace learned that her Kenosha employer, Powerbrace Corp., might be moving its operations to Mexico, she decided to follow her dream of becoming a math teacher.
With a bachelor’s degree in math already in her pocket she would need only to complete the requirements for a teaching license. She enrolled at Carthage College, where she took night classes for four years on top of working 40 hours processing accounts payable. In 2006, she had to quit her job to student teach. She landed a job as a substitute teacher at Bullen Middle School in Kenosha and continued to work toward a master’s degree through an online Walden University program. She completed the master’s degree 20 months later, and now has a full-time teaching position.
Dream achieved.
But Wallace’s career change left her with a total of $60,000 in student loans and the prospect of supporting her family of four on a teacher’s salary and the modest disability payments her husband receives. Her loan payments are $700 a month.
“I’ve been paying the first one [for the undergraduate degree] since 2007, and I still owe about $19,000 on that one. I finished the master’s program in August and owe $30,000 for that. It will probably take at least 12 years to pay it all off.” Wallace will be 54 years old by then.
She says her husband’s disability payments cover their mortgage, but the family has to get by on her income for everything else.
“We don’t go out to eat. We can’t take vacations. Our kids don’t get to do things the other kids get to do. It’s really hard knowing you can’t do things for your own kids.”
Those children, now 11 and 16 years old, both want to go to college.
“I’ve told them I’d chip in as much as I could. I’ve encouraged them to go for scholarships. The rest will have to be student loans,” Wallace says. “My kids seeing me get more education showed them this is what you need to do to survive. Without college, there’s not much out there for you.”
Wallace hopes she may be able to take advantage of a loan forgiveness option for her federal Stafford and Perkins loans after five years of teaching. She qualifies on two counts — she teaches mathematics and she teaches in a Title 1 school. But she worries that she might not make the five-year requirement.
“If I can get [those loans forgiven] it takes a lot of pressure off me. But we are facing layoffs again in our district.”
‘The interest is very high’
Tanya Oemig finished paying off her own student loans in her early 30s, but now, at 46, she faces paying back $15,000 she borrowed to send her children to college.
“They couldn’t borrow enough themselves,” she explains, adding that, as a single parent, she was unable to save for her children’s higher education.
Until recently, Oemig was a communicable disease surveillance specialist with the Wisconsin Division of Public Health. Her salary there was not enough to pay the bills after taking on the new debt, and she had to add a second job. She finally decided she was on overload and quit both jobs to work for a software development company at a higher salary.
“I loved the work at Public Health, but I just couldn’t afford to keep doing it. I was lucky to find a good place to work, and it pays enough that I’m able to make the payments on one salary now. There are people struggling a lot more than I am.”
Still, Oemig worries about her children’s prospects. Both still live with her. One graduated from Madison Media Institute in May with an associate degree and now works at a gas station while he looks for a job related to his skills and education. The other one is still at Madison College, working toward a two-year degree in information systems administration. He has a part-time help desk job, but his hours were cut recently.
“I worry about their job prospects all the time. Currently they don’t make enough to support themselves. They can make their loan payments, but they can’t pay for car insurance or cell phones. And I worry they won’t find a job before their education is obsolete. They are both very discouraged.”
Oemig thinks the time allowed before graduates have to start repaying student loans is unrealistic, given the dismal job market.
“Even if they had a job right out of school, they would have a lot of expenses getting started. They need more than six months so they can save enough to afford an apartment and maybe a car — to get their feet on the ground.”
And she wonders why interest on student loans is so high when loans for other purposes are cheap these days. One of her sons has a Sallie Mae loan with an interest rate of 10%.
“I had good credit so I could get federal loans, but those who don’t have to go to private loans where the interest is very high.”
‘Sometimes I wonder why I’m doing this’
There was never any question in Dustin Bradley’s family that the Beloit Memorial graduate would go on to college.
“My grandparents didn’t go to college, and my father [a third grade teacher in Wauwatosa] was the first and only one to get a degree. My family always encouraged me and expected me to get more education,” he says. However, he admits that he drifted during his first couple of years at UW-Madison, struggling with the math required for the business program where he first enrolled, and finally finding his academic passion in sociology.
“I did the victory lap,” he explains of his extra fifth year as an undergraduate. He will receive his bachelor’s degree in May.
But Bradley’s accumulation of student debt is not over. He plans to enroll in a paralegal certificate program next fall. It’s a high-demand skill, and he’s sure he’ll find work. Then, after a few years of gaining experience, he wants to enroll in law school.
So far, Bradley’s debt load is only about $12,500, lower than average, because his family was able to kick in for his first few years and because he worked an average of 32 hours a week while in school. But from here on out, he’s on his own.
He’s looking at paralegal programs at technical colleges in Madison and Milwaukee and at several online programs. The private web-based programs are convenient, especially for someone who has a job, he says, but they are more expensive. Programs at the tech schools cost about $4,000 for the one-year course. The costs for online courses that have accreditation range from $7,500 to more than $10,000. Bradley expects he will have to borrow that money on the far more expensive private student loan market, but hopes he can pay most it off before he starts law school.
That is where the really big debt will start to build. According to UW-Madison statistics, the average law school graduate in 2012 will owe almost $100,000. That number includes accumulated undergraduate debt, but law school alone leaves the average borrower some $80,000 in debt.
Still, Bradley is confident that incurring the debt will be a good investment. “I think I’ll be making enough to make [the payments] manageable. But it’s hard when I look at some of my friends who got jobs right out of high school at Chrysler or GM. They have high-paying jobs but don’t have this debt. So sometimes I wonder why I’m doing this.”
Cause for hope
Many college graduates face a sobering reality: turning 50 and still not being free of student loan payments. But there are efforts under way to ease the burden. The progressive organization One Wisconsin Now is launching an advocacy campaign that proposes the following for state residents:
  • A “truth in lending” provision, similar to what’s required for a mortgage, so students understand when they take out a loan how much they will be paying back and for how long.
  • Bankruptcy protection.
  • The opportunity to refinance or consolidate student loans.
  • Provisions for forgiving student debt.
One Wisconsin Now is also creating a website that will highlight national efforts at helping students with excessive debt. U.S. Sen. Dick Durbin, for example, has introduced legislation that would treat private student loans the same as other private debt under bankruptcy. President Obama favors linking student loan repayments to income; providing debt forgiveness after 20 years; and allowing greater flexibility on interest rates.
“This is an issue that is just starting to bubble up to the surface,” says One Wisconsin Now’s deputy director, Mike Browne. “We’re in relatively early days, legislatively.”

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2012年2月23日星期四

State Pensions Find Private Equity Bites as Blackstone Cuts Jobs

February 23, 2012, 12:58 AM EST
By William Selway and Martin Z. Braun
Feb. 23 (Bloomberg) — Shirley Kimber walked off the production line from her $17.56-an-hour job at a Birds Eye Foods plant in Fulton, New York, for the last time in November.
The new owners, Pinnacle Foods Group LLC, a company held by the private equity firm Blackstone Group LP, closed the factory and fired 270 workers. Kimber, 64, got eight weeks severance for her 12 years on the job and lives with her 37-year-old unemployed daughter in the rust-belt town of about 12,000, northwest of Syracuse.
“They just used us. That’s exactly what they did,” Kimber said. “And then they kicked us to the curb.”
While the closing killed union jobs, it may also help protect the retirement benefits that organized labor bargained for on behalf of public employees.
In addition to Blackstone, the world’s largest buyout firm, New York State’s two public employee pensions and four New York City pensions stand to gain from the drive for higher profits at Pinnacle foods. The retirement funds poured $920 million into the $20 billion Blackstone fund that owns Pinnacle, which took over Birds Eye in 2009.
Public pension funds — seeking to boost returns after failing to secure the 8 percent annual investment earnings needed to pay benefits for teachers, police officers and other civil servants — are the biggest source of cash for private equity firms.
Faster Pace
Companies owned by New York-based Blackstone added jobs at a faster pace than the U.S. economy for the past two years, said Peter Rose, a spokesman for the firm. Private equity’s investment returns “are one of the few ways that pension funds can help keep the promises that they have made to their retirees,” he said.
Pinnacle Foods closed the Fulton plant to cut transportation costs by moving operations closer to suppliers, said Michelle Weese, a spokeswoman for the company.
While firms such as Blackstone and Bain Capital LLC, co- founded by Republican presidential candidate Mitt Romney, have drawn scrutiny for their paring of jobs and the low tax rates enjoyed by executives, the role of taxpayer money in financing their acquisitions has received less notice.
By September 2011, public pensions with at least $1 billion in assets had an average of 11 percent of their money in private equity, more than triple their investments a decade earlier, according to Wilshire Associates, a Santa Monica, California- based consulting firm.
Rising Investment
Such funds have about $400 billion with private equity, 29 percent of the total, according to Prequin Ltd., a London-based private equity research firm. That’s more than twice what was put in by private pension funds, the next biggest investor.
Public pensions “have been the investors that have really fueled private equity’s rise,” said Steven Davidoff, a professor of law and finance at Ohio State University’s Moritz College of Law in Columbus, Ohio. “For those people who complain about private equity, the money is really coming from pension funds.”
Private equity firms buy companies and seek to trim costs, improve operations, boost profits and resell them. The takeovers are typically financed by debt taken on by the purchased companies.
The business has been drawn into the presidential contest as Romney parried attacks from Republican rivals who suggested he built a fortune of as much as $250 million with takeovers that cost workers their jobs. He has disputed this characterization.
Private equity executives, including Blackstone managing director and Pinnacle Foods director Prakash Melwani, have helped stock Romney’s campaign war chests. Melwani declined to comment.
Mayor Objects
Fulton Mayor Ronald Woodward, a Republican, said the Birds Eye takeover has devastated his town, adding that he is troubled to learn that New York pension money helped finance the acquisition.
“Isn’t that a slap in the face to the people in Fulton that are losing their jobs and paying the salaries of those union workers and they’re using their investments there,” Woodward said. “It’s like biting the hand that feeds you.”
Her severance exhausted, Kimber now lives off unemployment benefits of $1,620 a month, plus $100 a month in pension payments, she said. She pays 22 percent of that for health insurance. Her daughter, also named Shirley, has a biology degree but can’t find a job using that specialty. To make a few extra dollars, she babysits and sells books online.
Executive Compensation
Robert Gamgort is chief executive officer of Parsippany, New Jersey-based Pinnacle Foods, which also makes Dunkin Hines cake mix, Vlasic Pickles and Hungry Man frozen dinners.
Gamgort was awarded compensation valued at $5.5 million in 2010 and $11.6 million in 2009. Sara Genster Robling, head of the Birds Eye division, got pay packages worth $1.5 million in 2010 and $2.1 million the previous year. Most of the pay was in company stock. Gamgort and Robling weren’t available for comment, she said.
After the collapse of 1990s Internet bubble left pensions reeling from investment losses, state and local government funds poured money into private equity firms. The financial crisis of 2008 and subsequent recession left U.S. state public pensions $694.2 billion short of having enough assets to pay future benefits by the end of their 2010 budget years, according to data compiled by Bloomberg.
Higher Returns
Private equity deals promised higher returns than stocks and bonds. The 15-year median return on stocks for public pension funds with more than $1 billion assets, before fees, is 5.5 percent annualized as of Dec. 31, 2011, while the median return for private equity in that time period is 9.8 percent, according to the Wilshire Trust Universe Comparison Service.
The deals have served pensions well. New York state’s teachers pension’s private equity investments delivered an annual rate of return of 11.8 percent as of June 30, 2011. New York City’s private equity investments in four of its five pension funds have returns ranging from 9.2 percent to 11.1 percent.
That helps save taxpayers money. For workers and the acquired companies, the benefits can be harder to discern.
A study led by the University of Chicago’s Steven Davis, based on 3,200 private equity deals from 1980 to 2005 and published in September, sought to quantify the impact. It found that employment at acquired companies dropped 6 percent in the next five years relative to stand-alone peers as they shuttered lagging businesses.
‘Creative Destruction’
Still, the companies also added workers by opening new business lines and through acquisitions. The study concluded that such deals accelerated the “creative destruction” of jobs, with a “modest” impact on total payrolls.
“Private equity investors are remorseless in their perspective on business,” said Robert Bruner, the dean of the University of Virginia’s Darden School of Business. “That is a manifestation of the rigors of the capitalist system,” he said. “It accelerates the process.”
Rose Pitcher, 50, experienced that first-hand. After working 25 years at the Birds Eye plant in Fulton, she wrapped up her last shift in November, with eight weeks severance, as Pinnacle moved the plant’s jobs to Wisconsin and Minnesota. Other employers in the area, like an apple-packing plant in Oswego, pay less than half the $17 an hour she was making overseeing the machine sealing packages of Voila! ready-made meals at Birds Eye.
“There just doesn’t seem to be anything out there,” she said.
Portfolio Companies
Blackstone says it has a record of boosting employment overall. In 2011, Blackstone’s portfolio companies added 4.6 percent to their payrolls by creating new jobs, rather than through acquisitions, and increased them 3 percent in 2010, said Rose, the company spokesman. That outpaced job growth in the economy, he said.
“Private equity is a vital source of capital to grow and strengthen companies where public capital cannot or is unwilling to invest,” said Rose.
New York Comptroller Thomas DiNapoli, the sole trustee of New York’s $140 billion retirement fund, declined to comment. New York City Comptroller John Liu declined to comment. John Cardillo, a spokesman for New York state’s Teachers’ Retirement System, declined to comment.
Drivers coming into Fulton are greeted by the red-brick Nestle chocolate factory, where for 103 years the company made condensed milk, semi-sweet morsels and Crunch Bars. It shut down in 2003.
The Nestle factory employed 1,500 people at its height. In 1994, Miller Brewing also shut down a plant just outside of town, putting 900 people out of work.
Taking Down Signs
A couple of years after Miller shut its operations, city officials took down signs on Routes 481, 48 and 3, the thoroughfares entering Fulton, that read: “City with a Future.”
It’s a far cry from the 1930s, when the New York Sun wrote a story about Fulton entitled “The Mystery of Fulton, N.Y., the City the Depression Missed.” Then, factories powered by electricity generated by the Oswego River, which bisects the town, churned out knives, textiles and shotguns. The Fort Stanwix Canning Co. opened a plant in Fulton in 1902. In 1938 it began packaging Birds Eye vegetables.
Two Decades
The Birds Eye plant had survived during the past two decades as it passed from General Foods Corp. to Philip Morris Cos. to Dean Foods Inc. In 1998, Dean Foods sold it to Agrilink Foods Inc. for $400 million. In 2002, Agrilink sold a majority stake in the company for $175 million to Vestar Capital Partners, a private equity firm where Melwani was a managing director. Melwani is now at Blackstone.
Vestar transformed the company. In 2006, it shifted focus to brand-named foods and developing new product lines. It announced that it would jettison most of its non-brand frozen food businesses, affecting five facilities, including three in western New York, that employed about 740. In 2007, Birds Eye borrowed money to pay Vestar and Agrilink a one-time $298.2 million dividend, according to corporate filings.
Vestar turned Birds Eye into a smaller, profitable company. By 2009, Birds Eye earned $54 million on sales of $936 million, compared with a $131 million loss and sales of $1 billion in 2002. Its workforce had shrunk to 1,700 from 4,000, filings show.
In November 2009, Pinnacle Foods, owned by Blackstone, agreed to buy Birds Eye for $1.3 billion. The purchase was financed by $1.15 billion of debt. Blackstone contributed $260 million in equity. Carol Makovich, a Vestar spokeswoman, declined to comment.
$17 Million
Blackstone affiliates were paid $17 million in acquisition fees for arranging the Birds Eye deal. Pinnacle has also paid Blackstone at least $15.5 million in management fees since it was taken over by the firm in 2007, according to company filings.
Under Blackstone, Birds Eye’s sales and profits have risen. In the quarter that ended in September, sales were $248 million, an 11.2 percent increase from the year earlier. The growth was driven by expanded distribution and demand for new products, in addition to lower new product distribution expenses, the company said in a filing.
Charles Murphy, 66, had worked at the Birds Eye plant in Fulton through a series of owners for 22 years before retiring at the end of 2010. He said employees were optimistic that the factory would survive.
Schumer Press Conference
In January 2010, U.S. Senator Charles Schumer, the New York Democrat, held a press conference with workers in Fulton, saying he would keep pressuring the company until all the jobs were safe. Schumer said he called Stephen Schwarzman, Blackstone’s chairman and co-founder, and asked him to spare the factory.
“No one expected that place to close,” said Murphy.
Then Pinnacle started cutting jobs. In mid-2010, it began closing down the Rochester, New York headquarters where 200 worked. That December it announced the closure of a Tacoma, Washington, plant that employed 160 and would shift production to Iowa.
On April 13, 2011, a Wednesday, employees coming to work at the Fulton plant saw a makeshift sign taped to a window: A mandatory meeting for all employees would be held at the Fulton War Memorial, the town’s exhibition hall and gymnasium on the 15th.
A Birds Eye lawyer told those gathered that the company would close the Fulton plant and move some of the jobs to Wisconsin and Minnesota.
Paul Robinson, a 59 year-old who ran packing machines remembered asking managers, “What can we do to keep the plant open?”
‘Minds Made Up’
Nothing, he said Pinnacle managers replied. “They had their minds made up.”
Wisconsin had offered Pinnacle $1.3 million in incentives to shift production to the state. Worker’s compensation costs were also lower — an average of $1,100 per employee in Wisconsin compared with $12,000 in New York, Mayor Woodward said.
While new jobs were added elsewhere, the closures cut the Birds Eye’s payroll by about 300, or 17 percent, as it eliminated more jobs than were added elsewhere, according to Weese, the Pinnacle spokeswoman. She said such costs are common after corporate mergers.
“Synergies are true with every deal. It’s not unique to this particular deal,” Weese said. “It’s less expensive to run one company than two.”
Not all public pensions have stood by as a private equity firms managing their money announced job cuts.
Hugo Boss
In 2010, after hearing that clothing-company Hugo Boss AG was planning to close a factory in a Cleveland suburb where it manufactured suits, threatening the jobs of 300 workers, Ohio’s public employee pension fund contacted Hugo Boss’s owner, London-based private equity firm Permira Advisers LLP.
Ohio’s Public Employees Retirement System had invested $80 million in the Permira fund that owned Hugo Boss. After writing to Permira and not getting a response, the pension fund followed up with another letter saying it would “think long and hard” about investing any more money with Permira, said Hugh Quill, a former Ohio pension trustees. The plant was never closed.
“These guys could have cared less about a plant in Cleveland, Ohio, but they did care about not having institutional investors for their next $500 million offering,” Quill said. “I think it was the right thing to do, given the amount of pain and suffering that was going on in the state.”
The California Public Employees’ Retirement System and public pensions from Maryland and Pennsylvania, which invested in Permira, also lobbied the firm. So did New York City’s pension funds.
Liu’s Letter
“New York’s pension funds do not wish to be investing in job loss or in a global ‘race to the bottom,’” New York City Comptroller Liu wrote in a letter to Permira.
Chris Davison, director of communications for Permira, declined to comment.
In Fulton, Charles Murphy’s wife, Donna, had been out on medical leave since October 2010 when the Birds Eye closure was announced. Still struggling with lung cancer, she lost her job when she couldn’t return to work for the factory’s last two months. That meant she didn’t get any severance pay. She worked there for 25 years.
Pinnacle’s Weese said details about medical leave and severance pay were worked out in negotiations with the employees’ union, Workers United Local 1822.
‘Devoting Your Life’
“You spend that many years devoting your life to the company, coming in to work every day, and they think nothing of you,” said Murphy, who lives in nearby Oswego. “This hurt a lot of people’s livelihoods.”
Fulton mayor Woodward, who was a maintenance supervisor with Nestle when the plant shut in 2003, said his story is another sign of the times.
“What you’re doing by doing that — you are systematically eliminating the middle class,” he said. “You’re going to be rich or you’re going to be poor. There’s no in between.”
–Editors: Jeffrey Taylor, Larry Edelman
To contact the reporters on this story: William Selway in Washington at wselway@bloomberg.net; Martin Braun in New York at mbraun6@bloomberg.net.
To contact the editor responsible for this story: Jeffrey Taylor at Jtaylor48@bloomberg.net
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2012年2月13日星期一

Interest rates for common student loan could double this summer

Break’s over.
For the last five years, Congress has cut students a break on the interest rate for unsubsidized student loans, the most popular kind used at Ball State. Starting in July, if the low rate of 3.4 percent isn’t reinstated, it could go back to 6.8 percent, which represents an average $2,000 increase over the course of paying back the loan.
In 2007, the College Cost Reduction and Access Act was passed, which reduced the rate to 3.4 percent for undergraduate students. It was meant to help make college more affordable during poor economic times. Now the plan is about to expire.
“They only had a five-year plan,” said John McPherson, director of Ball State’s Scholarships and Financial Aid. “And now the only way to keep the cost low is to come up with more money to pay for it.”
Rep. Joe Courtney (R-Calif.) recently introduced a bill to keep the rate at 3.4 percent, and President Barack Obama has said he wants to keep it for at least a year.
“A college education is key to success in today’s economy,” said Courtney in a press release on his website. “But for many students, the spiraling costs of higher education are creating an immense barrier.”
For the average student using a subsidized Stafford Loan, it could means about a $2,000 increase over 10 years, according to information from the National Association of Student Financial Aid Administrators.
“If you look at averages, obviously a college degree provides opportunities you can never get anywhere else,” McPherson said. “Over the life of a person, it’s not going to be huge.”
Sophomore Joseph Dimaggio uses loans and grants to pay for college, and since he decided to add a second major, he anticipates being in college an extra two and a half years. He said he’s afraid that he’ll have to spend several years paying back his loans before he can start to settle down.
“There are a lot of things I’d rather do with $2,000,” he said.
He said he wants to become an actuarial scientist, and he said it’s important to know what jobs are in demand.
“We hit such a low,” he said. “And I have a lot of friends that are older and overqualified for the job they have, especially in teaching.”
Last academic year, about 10,400 Ball State students used subsidized Stafford loans. Altogether, they borrowed $44 million.
Even if the interest rate is brought back to 6.8 percent, McPherson said this is the best deal for most students, especially if this is their first time taking out a loan. Private lenders might deny them, or give them a higher interest rate, McPherson said.
Perkins loans have a fixed 5 percent interest. But they are for extremely needy students, and not many people qualify, he said.
With a subsidized loan, the federal government absorbs the interest while a student is in college and six months afterward. If the CCRAA program is abolished, students would be responsible for the interest accumulated during the six months after they graduate.
With unsubsidized loans, students pay the interest that is built up during college and during the six-month grace period after graduation. The government uses a formula to determine a student’s need and how much money they will receive with each type of loan. The formula includes factors like income, family size, number of people already in college and the family’s assets.
Every year, two thirds of Ball State students borrow some kind of loan, McPherson said. In 2010-2011, undergrads were leaving college with an average debt of $24,121.
Rob Tyler, an adjunct professor of personal finance and the founder of Tyler Wealth Management, offered examples of how this would impact students. His estimate: not very much.
To repay the average student loan over 10 years with an interest rate of 3.4 percent, the monthly payment is about $237.59. At a rate of 6.8 percent, the monthly payment jumps to $277.79, an increase of just $40.20.
Tyler crunched a few numbers based on loan information from the Ball State Credit Union.
The interest rate for a loan from the credit union on a new car, for example, is 2.99 percent. In order to offset the extra $40.20 a student is paying back on student loans, and with the interest rate for a new car taken into consideration, they would need to buy a car that costs $2,237 less than what they had previously budgeted.
On a loan for a new house, Tyler used a 4.5 percent fixed interest rate on a 30-year mortgage for his example. In that case, to accommodate the extra $40.20 a month in student loans, he or she would want to buy a house that’s about $8,000 less than they budgeted — not a huge amount relative to a $200,000 home.
“You have to think, what’s my sacrifice?” Tyler said. “Your college education is going to last you a lifetime.”

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2012年2月6日星期一

Easily Maneuvering Through Entrepreneurial Risks

Starting off on the ground level, I have helped grow family business 20 years ago in India. The concept of venture financing did not exist at that time and no seed funds were available through bank loans. My father, who is my hero and role model made it seem that anything was possible if you believed in it. He knew how to grow the business organically and take manageable risks. I co-founded Serus Corporation based in Mountain View, CA, along with Barbara Hoefle who also believed in much of the same principles. What have we learnt? Some fundamentals that haven’t changed over time—fundamentals that we are very passionate about.
Create Return on Investment—the Bottomline: You have a great idea and want to start a company. What is the first thing to do? Develop an investor presentation and start looking for money? Wrong! You need to put together a product presentation and start looking for paying customers. This may seem like an impossible task at first. It is not.
Focus on a sustaining model: Start thinking about creating long-term value. Before seeking investment, you need to understand that your primary responsibility is to generate value and return 10 to 50 times the investment, within a 3 to 5 year period. Investors are in the business to make money and entrepreneurs are in business to innovate.
Investment alone is NOT going to help: It saddens me to see today’s entrepreneurs’ first task while starting a company is to seek investment. It almost seems like obtaining venture capital is the main goal of starting the company. This is quite like thinking that you want to buy a house because your goal is to get a mortgage loan. The goal is NOT the mortgage, the goal is to improve your living conditions or to make an investment by buying the house. A mortgage loan just enables you to achieve that goal. The aim of starting a company should be to satisfy a market need that would in turn nurture the life of your company. Venture funds should only be to enable you to achieve that goal.
Measure Revenue-per-employee and profits: In failing to educate young entrepreneurs of their responsibility when seeking investment, we will continue to create companies doomed to fail rather than succeed. Avoid falling into the hole that many companies have fallen into during the last few years. Entrepreneurs need to stop getting carried away with investor pitches. Example: The very famous ideal “hockey stick” financial growth plan that everyone knows is just that—ideal.
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2012年1月23日星期一

Prospect Capital and Other Shareholders Enter Into Definitive Agreement to Sell NRG, With Prospect Expected to Receive …

NEW YORK, NY–(Marketwire -01/23/12)- Prospect Capital Corporation (NASDAQ: PSEC – News) (“Prospect”) announced today that Prospect and other third-party shareholders have executed a stock purchase agreement to sell their ownership interests in NRG Manufacturing Inc. (“NRG”), a leading manufacturer of oilfield equipment.
The transaction is subject to regulatory approval and is expected to close within the next 30 days. Such closing would also result in full repayment of Prospect’s loan to NRG.
Prospect expects to collect approximately $100 million in cash in the March 2012 quarter related to the sale of NRG. This $100 million would consist of approximately $30 million of investment income in the form of prepayment premium and structuring fee, with the remaining approximately $70 million related to debt repayment and equity proceeds. Additional amounts are expected to be escrowed for potential collection in future periods, resulting in potential incremental post-closing proceeds to Prospect of approximately $14 million. As a result, Prospect would receive a total of up to $114 million from the sale of NRG.
Prospect initially invested approximately $12 million of debt and equity in September 2006 to help finance the acquisition of NRG. Including all cash flows over the life of the investment, but not including escrowed amounts, Prospect expects to realize at closing on its combined debt and equity investment a 59% annualized internal rate of return.
With the expected sale of NRG, Prospect estimates it will have generated cumulative net investment income in excess of cumulative distributions to shareholders for both the current August 2012 tax year as well as since Prospect’s inception.
“Coming on the heels of the sale of Gas Solutions by our Energy Solutions portfolio company, Prospect’s sale of NRG adds another valuable realization to the Prospect Capital track record,” said M. Grier Eliasek, President of Prospect. “Our team is hard at work to invest our substantial liquidity. With our more than $1 billion of new originations in calendar year 2011, we have significant capability to invest such liquidity.”
“We applaud the managers of NRG, who have built the company into a premier supplier of mission-critical oilfield equipment,” said Bart J. deBie, a Managing Director of Prospect Capital Management. “Prospect is actively seeking new control and non-control investments across all industries.”
RBC Capital Markets is acting as financial advisor to NRG for the sale.
Separately, Prospect has provided $18.3 million of secured second-lien financing to a financial services processing company purchased by a leading private equity sponsor. Prospect has also invested $34.4 million in Class D senior secured notes and Class E subordinated notes for CIFC Funding 2011-I, Ltd., with third party first loss capital underneath Prospect’s position.
ABOUT PROSPECT CAPITAL CORPORATION
Prospect Capital Corporation (www.prospectstreet.com) is a closed-end investment company that lends to and invests in private and microcap public businesses. Our investment objective is to generate both current income and long-term capital appreciation through debt and equity investments.
We have elected to be treated as a business development company under the Investment Company Act of 1940 (“1940 Act”). We are required to comply with a series of regulatory requirements under the 1940 Act as well as applicable NASDAQ, federal and state rules and regulations. We have elected to be treated as a regulated investment company under the Internal Revenue Code of 1986. Failure to comply with any of the laws and regulations that apply to us could have an adverse effect on us and our shareholders.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, whose safe harbor for forward-looking statements does not apply to business development companies. Any such statements, other than statements of historical fact, are highly likely to be affected by other unknowable future events and conditions, including elements of the future that are or are not under our control, and that we may or may not have considered; accordingly, such statements cannot be guarantees or assurances of any aspect of future performance. Actual developments and results are highly likely to vary materially from these estimates and projections of the future. Such statements speak only as of the time when made, and we undertake no obligation to update any such statement now or in the future.
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2012年1月17日星期二

Movement under way to ease investment by Web

OAKLAND, Calif. – Ian Schuster and his business partners have raised almost a quarter of a million dollars to launch their craft beer brewery company, but if they had more money, they could grow the business much faster.
Bryan Brumfield has poured most of his life savings into the artisanal wine business he plans to launch after he retires as an Oakland firefighter in March, and needs additional capital to bring in outside expertise.
Each would love to tap the power of social media to find additional investors online who would each put up small amounts of money in exchange for equity stakes in their companies, a concept called “crowdfunding.”
But they can’t do so under current law. Companies can sell shares to what the SEC calls “accredited investors” – seasoned, high-net-worth people who understand the risks. But financial stakes for small-time investors are limited to 35 people (fewer in some states), just enough to enable some friends-and-family funding, but not enough to harness the Internet’s reach to attract a larger number of equity investors.
Popular websites like Kickstarter and IndieGoGo show the power of crowdfunding, by letting people request funds online from strangers to back specific projects – a theater performance, for instance. But the people who pledge money can only receive perks like T-shirts, not equity shares, in exchange.
Then there are lending websites like Prosper.com that allow for person-to-person loans. People ask to borrow money for anything from plastic surgery to starting a company and offer a fixed interest rate in return. But again, equity stakes are not allowed.
Now, legislation pending in Congress that enjoys strong bipartisan support and Obama administration backing may make crowdfunding possible for entrepreneurs.
Crowdfunding “has the potential to be a powerful new venture capital model for the Facebook and Twitter age, and its potential to create jobs is enormous,” said Sen. Scott Brown, R-Mass., in congressional testimony last month.
“But crowdfunding is currently illegal because of obsolete regulations, some dating back to the 1930s.”
Brown is sponsoring the Democratization of Capital Bill, which would let small companies sell up to $1 million in equity online in chunks of $1,000 or less. It is under review by the Committee on Banking, Housing and Urban Affairs.
A similar bill, the Entrepreneur Access to Capital Act, passed the House in November by a wide margin. It would allow up to $2 million in crowdfunded investments in $10,000 increments.
But some worry that crowdfunding would entice online hucksters to set up shop.
“A lot of people believe everything they see on the Internet, so we are concerned about fraud,” said Jack Herstein, president of the North American Securities Administrators Association. “Scam artists follow the hottest trends. They could make up fraudulent websites. … Once you push the button and send your credit card number, your money is gone.”
Still, he said, he is not opposed to crowdfunding. He just wants built-in safeguards.
“Everybody should be behind anything that helps the economy,” he said.
At a time when banks can be reluctant to make loans, letting small enterprises solicit funds online so they can start up and grow makes sense, crowdfunding supporters say.
“Crowd sourcing for us would be a dream come true,” Schuster said. His Schubros Brewery, based in San Ramon, will start beer production in March after getting its government license. The five partners have done well raising money from themselves, friends and family and a couple of accredited investors.
“We have enough to get started,” he said. “But if we could get more money, we would be more stable from Day 1. We could hire full-time salespeople and grow faster than planned.”
Brumfield, the Oakland firefighter, said crowdfunding would make a huge difference to him. “Unless things change in the banking world, crowdfunding would be the best opportunity besides friends and family for the additional capital I need to launch,” he said.
csaid@sfchronicle.com
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2012年1月9日星期一

Student loans: Pay them down or start an emergency fund?

Student loans are above $50,000, but there are ways to balance saving with paying down debt. See questions No. 2, 3, and 5 for advice on student loans.
What’s inside? Here are the questions answered in today’s reader mailbag, boiled down to five word summaries.
1. Investing in light of default
2. Debt eradication
3. Loans or emergency fund?
4. Repetitive questions
5. What’s next on my path?
6. Time for a financial advisor?
7. Polite hygiene advice
8. Wedding and financial planning
9. What are readers like?
10. 2012 predictions
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Trent Hamm
The Simple Dollar is a blog for those of us who need both cents and sense: people fighting debt and bad spending habits while building a financially secure future and still affording a latte or two. Our busy lives are crazy enough without having to compare five hundred mutual funds – we just want simple ways to manage our finances and save a little money.

Recent posts

How long does it take for you to stop dating checks and other documents with the previous year after the calendar flips?
I’ll admit that it will probably take me most of January to get used to writing 2012.
Q1: Investing in light of default
I have a small IRA, with half in a mutual fund, which has topped out, and the other half in two stocks which are near to bottoming out, from a lag factor associated with recession and reinvestment.
I anticipate a currency devaluation as an effect of renegotiation or default on national debt limits. Would overseas money markets be a safe place to stash funds from the sale of the mutual while I wait for it to drop so I can repurchase it? If you believe that our debt problems will negatively impact overseas money markets, what is an alternate spot, exclusive of index funds, which will drop as the market does?
- Monica
I don’t think I would trust overseas money markets more than domestic ones, as I think a lot of economies are facing some sort of currency devaluation due to the ongoing economic conditions.
I also wouldn’t bank my entire plan on market timing, particularly when you’re making moves based on a sense of a fund having “topped out” or “bottoming out.” If I were you and I moved forward with this plan, I’d set some thresholds on when to buy back in. For example, you might want to say that you’ll buy back in after three months if either the value of the fund is down, say, 15% or it matches the value you sold it at.
Don’t worry about what the absolute top of the market is or what the bottom is – worry about making money for yourself.
Q2: Debt eradication
I’m a 22-year old student who will graduate with a B.A. in December. I took out some federal and private loans to pay for school. I saved for the past year and paid off the private loans while in school. I’ll be left with $16,000 at 6.8% when I graduate. I have no other debt and a 3-month emergency fund ($6,000). I plan to make payments well over the minimum to pay this balance off in 2 years or less.
Is this a good thing? The more I research credit and credit scores, it seems that a relatively low-balance loan isn’t a bad thing to keep around for ten, even fifteen years. However, having a positive net worth is my #1 priority. Should I be making aggressive payments or simply using that money to pad my retirement and savings while keeping the loan around? While paying the loan aggressively I’ll still be contributing 15% of my net income to an IRA. I have one credit card with a $500 limit; never carried a balance. I pay bills on time every month. I currently rent. A house isn’t on my to-do list, and I’ll buy a car outright if I get one in the future. Is it enough to build my credit without a credit card balance, mortgage, car payment, and (soon) no student loan?
- Belinda
I don’t think the value of having a 6.8% student loan (in terms of your credit score) is worth the financial cost of having to pay 6.8% interest on the balance every year. If it’s within your means without causing other financial troubles, I would pay it off sooner rather than later.
Given that you do have a continuing line of credit in the form of your credit card, your credit report won’t go completely empty after you pay off the student loan. I would consider using the card regularly (and paying off the balance) and being open to moderate raises in your credit limit.
You’re doing very well. Keep along your current path and you’ll continue to do very well.
Q3: Loans or emergency fund?
I’ll graduate from grad school this May with $25,500 in federal subsidized loans (spouse and I also still have $27k combined undergrad debt at 5.3%). I haven’t technically needed these loans for the last year of school but because they’re subsidized I’ve been storing the money in a rewards checking account earning about 3%. It will be around 12,000 total in November when the subsidization ends and 6.8% interest kicks in. This is the extent of our short-term savings/emergency fund right now (my spouse and I are also saving for retirement). So, since we are looking to save for life’s big things in the next few years (car, family, and house, probably in that order), and we don’t have a defined emergency fund amount, I wonder how much of that 12k should we pay back immediately? We’re currently steadily employed though I’m seeking new full-time work in my desired field instead of my current part-time job. We have roughly $1000 extra/month to put to good use on student loan repayment and savings (we’re a pretty frugal couple), but I’m not sure what the best combination would be. We have to pay minimum $400/mo on our student loans. Is it best to pay more on student loans and postpone more emergency/car/baby/home savings? Is it best to pay back the entire $12k “savings” (which is really borrowed money) and start our “real” savings from scratch? I’m lost and confused and would be interested in your and your readers’ opinions. 
- Danika
If I were you, I would establish a new emergency fund and fund it with enough money to provide three months or so of living expenses for you and your partner. I would then use the remainder to pay off your highest loan and then use the subsequent $1,000 per month toward minimum payments and whatever loan has the highest interest rate.
I would count that 6.8% loan as already having that rate and make “payments” on that debt to a savings account. Then, when the subsidization ends, I’d pay the entire balance of that savings account to that 6.8% loan.
In terms of balancing emergency protection and a path toward debt freedom, I think this is a very good plan.
Q4: Repetitive questions
I’ve noticed that there are a lot of consistent shall we say themes in your reader mailbag questions. Student loans come up a lot for example and so does retirement. Why repeat so much?
- Shaun
The reason these stories show up so often is because they’re the type of concerns that cause people to really start thinking about their finances and because they are so common among people. A lot of people leave college with student loans and they worry about paying them off.
I use a lot of these types of questions because there are a lot of variations in the story and because it’s a genuine concern that a lot of people out there have.
I try to choose questions that reflect the whole of the questions that I receive. I do often pick out specific interesting ones, but I also see from my email inbox that I get a LOT of questions about student loans, so I cover those questions.
Q5: What’s next on my path?
I’m now fortunate to be in a position where I’m (finally) earning a great wage at a company I have no intention of leaving anytime soon, living in a city (NYC) that I love, and living well below my means.
It’s been drilled into me for years that paying off your credit card(s) and building a healthy emergency fund are the first foundation steps to a healthy financial life. I’ve accomplished both (finally!), and have $0 credit card debt (only one credit card), and $11,000 in savings. I still have outstanding student loans, which I’m paying back and contributing more than the minimum on each month – these are at a very low interest rate, and the total repayment each month comes to $350. Paying off one would save me about half of that amount as the payments are pretty much equal between the loans.
I’m also putting $12,000/year into a 401(k), and am planning on continuing to contribute $1,000/mo into my savings account for the next 9 months – until it reaches $20,000. Since I live in NYC, I plan on renting for quite a few more years and I’m planning ahead for when I’ll want to move (moving into a new apartment here typically costs $4-5,000 upfront in costs for my price range – first month’s rent, last month’s rent, possibly a broker’s fee and a security deposit). 6 months of my bills (if I were laid off) comes to about $15,000, and that’s my emergency fund savings goal since I don’t have close family in the area and wouldn’t want to have to move due to prolonged unemployment. The $20,000 goal for this year assumes that I’ll want to move within the next year, which is a possibility (but not set in stone).
I’m not in a hurry to change my plans right now as I still have a bit of time left to contribute to my savings account, but I’d like to have some solid steps in place when I get there.
So – what comes next? It seems like after the savings account, credit card and retirement account are all healthy (or being contributed to healthily), that any number of options open up. I don’t get an employer match on my 401(k), so it’s 100% my own money in there, and I’d like to max it out for a few years, due to not being able to contribute anything in my younger 20′s (4 years of working w/o the spare $$ to contribute). But, I’ll still have a good amount of money that I’m now putting into savings left over after maxing out my 401(k), and I want to make sure I’m investing it wisely, if that’s even the right first step after this.
Are there any recommended steps after this point, or does it depend on the individual and their goals?
- Jill
It really comes down to goal-setting more than anything else.
Simply put, there is no general right way to invest. There are only good ways to invest to help you reach a specific goal. If you don’t know what you’re saving for, you’re probably going to save in an inopportune manner.
Let’s say, for example, that you decide to start investing in stocks because you heard they have a great return, not because you had any goals in mind. Let’s say you make this decision in January 2008. In December 2008, you decide to buy a house because you got pregnant and you decided you needed a house for that child. Your money has now lost 40% of its value.
You would have been far better off in a savings account had you incorporated the idea of buying a house in the next one or two years into your plan.
Spend some time thinking about where you want your life to be in five years or ten years. Where are you headed? Your investment choices should really follow that.
Jill also had a follow-up question.


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BerGenBio Completes $9 Million Series A Financing for First in Class Oncology Therapeutics

BERGEN, Norway–(BUSINESS WIRE)– BerGenBio AS, an emerging oncology biopharma company, today announced it has completed an $8.8 million Series A financing round. The financing will be used primarily to take lead compound BGB324 into clinical trials and to develop a companion diagnostic. Lead investors are Sarsia Seed AS and Investinor AS.
BerGenBio CEO Richard Godfrey commented: “This significant new funding from both existing investors and now from Investinor, we believe supports our decision to focus on developing BGB324, our first-in-class Axl kinase inhibitor drug, rapidly towards clinical trials. BGB324 recently attracted a great deal of attention at the annual American Society for Hematology conference in San Diego, where data were presented data showing the compound inhibited tumour development in preclinical Acute Myelogenous Leukemia (AML) models. Furthermore we have shown that inhibition of Axl blocks the epithelial-mesenchymal transistion (EMT) in cancer cells and has the potential to delay or prevent metastasis, overcome and even reverse acquired resistance to chemotherapy and possibly prevent cancer recurrence. We now look forward to completing the preclinical work and taking BGB324, into the clinic by the end of 2012, as well as developing an AXL biomarker for theranostic use.”
Sveinung Hole, CEO of Sarsia Seed, a leading provider of seed capital in Norway, added that he was delighted to increase its investment in BerGenBio: “We regard BerGenBio as one of the most promising companies in our life sciences portfolio and are particularly impressed by the way in which the management is driving the preclinical development programme for BGB324 forward and meeting all preset milestones. We consider that the high quality of research and development at BerGenBio is the critical factor that has led to this significant funding in today’s challenging financial climate. We see BerGenBio’s success as “seeding” a long awaited biotech cluster here in Bergen.”
Anne-Tove Kongness, Investment Director at Investinor, a Norwegian-government-owned venture investment company commented: “We invest in Norwegian companies that have the potential to truly compete on an international basis. We believe that BerGenBio has the ability to do this by taking what is already world-class oncology research in Bergen and translating it into first-in-class therapeutics.”
Notes to editors
BerGenBio AS is an oncology-based biopharmaceutical company located in Bergen, Norway focused on pursuing novel therapeutic treatments for cancer and supporting the screening and identification of a wide array of potential targets in collaboration with other pharmaceutical companies. BerGenBio has a proprietary platform technology called CellSelect™, which uses information from RNAi screening studies to identify novel drug targets involved in disease. The company has a deep understanding of cancer biology and in particular the tumor micro-environment, EMT and mechanisms of drug resistance. BGB324, a first-in-class inhibitor of AXL kinase, is the first of a planned pipeline of oncology therapeutics planned for clinical development through to phase II in partnership with industry leaders. The company’s investors include Investinor, Sarsia Seed, Sarsia Development, Norsk Innovasjonskapital, Birk Venture, Meteva and employees. www.bergenbio.com
Sarsia Seed AS is a Norwegian Seed Capital Fund, which invests in Norwegian early phase technology companies within the energy/cleantech and biotechnology/life science sectors. The fund has a total capital of 333.5 million NOK (approx, 40 mEUR/50 mUSD) and is managed by Sarsia Seed Management AS. The management company advises the Fund board regarding investment decisions. The Fund’s duration is expected to be 12 (+3) years. www.sarsiaseed.com
Investinor AS invests in Norwegian-based, high potential companies that are internationally oriented and in phases ranging from early growth to expansion. The company has BNOK 2.2 under management. Investinor AS has a co-investment strategy and can take up to 49% equity ownership of a portfolio company. Investinor is fully owned by Innovation Norway, which in turn is owned by the Norwegian Ministry of Trade and Industry. http://www.investinor.no/


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2012年1月2日星期一

/ CORRECTION – W. P. Carey & Co. Announces the Passing of Its Founder and Chairman Wm. Polk Carey

NEW YORK, NY–(Marketwire -01/02/12)- In the news release, “W. P. Carey & Co. Announces the Passing of Its Founder and Chairman Wm. Polk Carey,” issued earlier today by W. P. Carey & Co. LLC (NYSE: WPC – News), we are advised by the company that the sixth paragraph should mention “Arizona State University” rather than “University of Arizona” as originally issued. Complete corrected text follows.
W. P. Carey & Co. Announces the Passing of Its Founder and Chairman Wm. Polk Carey
NEW YORK, NY — January 2, 2012 — W. P. Carey & Co.’s Board of Directors sadly announces that company founder and Chairman Wm. Polk Carey died earlier today.
Mr. Carey, who was 81 years old, died of natural causes at Good Samaritan Medical Center in West Palm Beach, Florida. He was surrounded by family and friends, who had traveled to be with him.
Company Chief Executive Officer Trevor P. Bond stated, “Bill Carey was more than our founder and Chairman — he was the cultural leader of our company. All of us at W. P. Carey & Co. are mourning his loss. At the same time, we know that the best way for us to honor Bill is to continue to deliver outstanding results to our investors. It is up to us, as members of the team he put into place, to continue his life’s work and to ensure that the standards of excellence he established at W. P. Carey & Co. remain intact.”
Mr. Bond continued, “Bill was unwavering in his devotion to our shareholders, and he was especially proud that we have been able to provide increasing income to them, while providing our tenant companies with the capital that allowed them to grow their business and prosper. He felt deep gratitude toward our employees for enabling the firm to deliver such consistently outstanding results in good times and bad.”
Bill Carey was a pioneer in the field of corporate finance for nearly 60 years. Under his leadership, W. P. Carey Co. LLC provided hundreds of companies the capital they required to thrive and prosper. He was largely responsible for development of the sale-leaseback investment strategy for commercial real estate, and his firm remains a global leader in the industry.
In 1988, Mr. Carey established the W. P. Carey Foundation, which supports educational opportunities for young people through significant endowments presented to Arizona State University, Johns Hopkins University and the University of Maryland, as well as contributions to many other fine educational institutions. His brother, Francis J. Carey, said, “Bill was not only an insightful businessman but a wonderful brother and a good citizen. He always felt grateful that he was raised in a family committed to public service — and he worked passionately to uphold that tradition.” Mr. Carey was a direct descendent of President James K. Polk.
Photos and further information are available at http://www.wpcarey.com.
W. P. Carey & Co. LLCW. P. Carey & Co. LLC (NYSE: WPC – News) is an investment management company that provides long-term sale leaseback and build to suit financing for companies worldwide and manages a global investment portfolio of approximately $11.8 billion. Publicly traded on the New York Stock Exchange (WPC), W. P. Carey and its CPA® series of non-traded REITs help companies and private equity firms unlock capital tied up in real estate assets. The W. P. Carey Group’s investments are highly diversified, with approximately 284 long-term corporate tenants spanning 28 industries and 18 countries. http://www.wpcarey.com/

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W. P. Carey & Co. Announces the Passing of Its Founder and Chairman Wm. Polk Carey

NEW YORK, NY–(Marketwire -01/02/12)- W. P. Carey & Co.’s Board of Directors sadly announces that company founder and Chairman Wm. Polk Carey died earlier today.
Mr. Carey, who was 81 years old, died of natural causes at Good Samaritan Medical Center in West Palm Beach, Florida. He was surrounded by family and friends, who had traveled to be with him.
Company Chief Executive Officer Trevor P. Bond stated, “Bill Carey was more than our founder and Chairman — he was the cultural leader of our company. All of us at W. P. Carey & Co. are mourning his loss. At the same time, we know that the best way for us to honor Bill is to continue to deliver outstanding results to our investors. It is up to us, as members of the team he put into place, to continue his life’s work and to ensure that the standards of excellence he established at W. P. Carey & Co. remain intact.”
Mr. Bond continued, “Bill was unwavering in his devotion to our shareholders, and he was especially proud that we have been able to provide increasing income to them, while providing our tenant companies with the capital that allowed them to grow their business and prosper. He felt deep gratitude toward our employees for enabling the firm to deliver such consistently outstanding results in good times and bad.”
Bill Carey was a pioneer in the field of corporate finance for nearly 60 years. Under his leadership, W. P. Carey Co. LLC provided hundreds of companies the capital they required to thrive and prosper. He was largely responsible for development of the sale-leaseback investment strategy for commercial real estate, and his firm remains a global leader in the industry.
In 1988, Mr. Carey established the W. P. Carey Foundation, which supports educational opportunities for young people through significant endowments presented to the University of Arizona, Johns Hopkins University and the University of Maryland, as well as contributions to many other fine educational institutions. His brother, Francis J. Carey, said, “Bill was not only an insightful businessman but a wonderful brother and a good citizen. He always felt grateful that he was raised in a family committed to public service — and he worked passionately to uphold that tradition.” Mr. Carey was a direct descendent of President James K. Polk.
Photos and further information are available at http://www.wpcarey.com.
W. P. Carey & Co. LLCW. P. Carey & Co. LLC (NYSE: WPC – News) is an investment management company that provides long-term sale leaseback and build to suit financing for companies worldwide and manages a global investment portfolio of approximately $11.8 billion. Publicly traded on the New York Stock Exchange (WPC), W. P. Carey and its CPA® series of non-traded REITs help companies and private equity firms unlock capital tied up in real estate assets. The W. P. Carey Group’s investments are highly diversified, with approximately 284 long-term corporate tenants spanning 28 industries and 18 countries. http://www.wpcarey.com
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2011年12月30日星期五

Win a Flight Anywhere in the World with Amble Resorts’ Travel Contest

CHICAGO , Dec. 29, 2011 /PRNewswire/ — Hopeful travelers are invited to share a personal, life-changing travel experience on Amble Resorts’ travel blog, The Ambler, for the chance to win a flight anywhere in the world. The individual who posts the winning entry will be rewarded with a free trip to the destination of their dreams in the form of a $1,500 travel voucher, valid anytime in 2012, on the airline of the winner’s choice.
By launching this contest, Amble Resorts is encouraging 2012 New Years ‘ resolutions to explore the world in search of adventure and immersion in place. It was an experience of this kind that first inspired Amble’s president, Benjamin Loomis , to found the eco-development company in 2007. Amble helps adventurous spirits from all over the globe to discover the unique cultural identities and incredible natural attributes of their chosen destinations while creating a community of travelers who share a passion to protect these precious resources.
“Travel is an intimate endeavor,” says Loomis. “You come away from a meaningful travel experience with your own perceptions and opinions. It’s these profoundly personal responses that we’re hoping everyone will share through the contest.” The contest reflects Amble’s mission to bring travelers into closer communion with the earth, other peoples, and each other. By publishing the contest entries as comments on The Ambler, Loomis hopes to spark conversations between travelers and travel enthusiasts who share a passion for adventure, culture, and the environment.  This format also invites entrants to join The Ambler‘s growing travel community and read new articles published daily.
Last fall, Amble Resorts expanded their travel blog of three years by inviting travel writers and photographers to join them in their efforts to inspire and enlighten today’s most culturally sensitive and environmentally conscious travelers. Through informative articles, stunning photography, and firsthand experiences of travel writers from around the world, Amble is pioneering a new online source for travel advice. Going beyond traditional destination guides, The Ambler provides insider tips on adventures off the beaten path, lesser-known natural and cultural attractions, and secluded pieces of paradise hidden in popular tourism destinations, all presented with the ease and intimacy of a personal travel blog. The Ambler hopes to give a voice to today’s most discerning travelers and feed their appetite for life-changing travel in a forum that’s accessible to anyone with an interest in learning more about the world.
President Loomis envisions a future for The Ambler as a trusted resource for travelers from all over the world who want to find new meaning for their lives with every journey they take. Accordingly, Amble Resorts’ current development projects in Panama and Belize are designed to give travelers an intimate connection with the extraordinary natural surroundings of the location. “We’re blazing the trail to provide travelers with something they can’t find anywhere else: a luxury travel experience connected to the true spirit of a place,” says Loomis. “Our travelers respect the environment and local cultures; they recognize what is most precious in our world. We build resorts founded on these values while recognizing that the traveler’s time is precious, too. They want to be as close as possible to these life-changing experiences without sacrificing their time or comfort.”
Submissions to the Life-Changing Travel Contest will be accepted through January 15th, 2012 . The top ten finalists, as chosen by Amble Resorts, will be posted to The Ambler on January 18th, 2012 for the public to vote on their favorites through January 31st, 2012 , when the voting period will close. The life-changing travel experience that receives the most votes will be announced as the winner on February 1st , 2012.
Photos:
http://www.ereleases.com/pic/Travel-in-2012.jpg
http://www.ereleases.com/pic/Amble-travel-contest.jpg
About Amble Resorts:
Amble Resorts is an ecologically sensitive resort development company focused on providing travelers life-changing travel experiences in places of spectacular natural beauty and cultural significance. Those who want more out of travel, amble with us.
Amble Resorts is the developer of The Resort at Isla Palenque in the Gulf of Chiriqui, Panama .
Media contact: Emily Kinskey , Marketing Associate, Amble Resorts, ekk@amble.com, 773-769-1145
This press release was issued through eReleases(R).  For more information, visit eReleases Press Release Distribution at http://www.ereleases.com/.

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